Thursday, November 11, 2010

National Commission on Fiscal Responsibility Makes Some Recommendations

Formally called the National Commission on Fiscal Responsibility, it was created by Obama in February to recommend policies aimed at balancing the budget by 2015. The final report is due by Dec. 1 -- a date intentionally chosen to come after the midterm congressional elections because the contents were expected to be inflammatory.

Among their recommendations, the commission co-chairs would:
  • Try to make Social Security more solvent by reducing annual cost-of-living increases for many recipients; raise the regular retirement age to 68 years by 2050 from the current 66, and to 69 by 2075; and make benefits more progressive to help Americans in lower-earning tax brackets. But changes would only benefit the Social Security program, not broader budget deficits.
  • A gradual 15-percent a gallon increase in the federal gasoline tax from the current 18.4 cents.
  • Reform cost-of-living increases for early civilian and military retirees.
  • Reduce Congressional and White House budgets by 15 percent; freeze federal salaries, bonuses, and other compensation at non-Defense agencies for three years; cut the federal workforce by 10 percent; and slow the growth of foreign aid.
  • Eliminate all congressional earmarks.
  • Eliminate funding for commercial spaceflight.
  • Sell excess federal property.
  • Consolidate the tax code into three individual rates and one corporate rate; eliminate the alternative minimum tax and some expense-write-off programs; increase the federal gas tax and some other user fees.
  • Reduce farm subsidies by $3 billion per year by reducing direct payments and other subsidies.
  • Make scores of other changes, including an end to payments to states and tribes for abandoned mines; an extension of the Federal Communications Commission's authority to auction radio spectrum licenses; a requirement that the Tennessee Valley Authority impose transmission surcharge on electricity sales.

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